Footwear Insight

4 • Footwear Insight | Sports Edition ~ May 2021 footwearinsight.com THE FOOTWEAR EYE By Bob McGee A continued pivot away from dress offerings toward athletic and athleisure footwear styles remains evident at both Shoe Carnival and DSW. And at sporting goods chain Dicks' Sporting Goods, a focus on offering more premium service in its footwear departments is garnering attention. Merchandise Moves at DSW Designer Brands-owned retail chain DSW is making merchandise moves to keep in step with the times, moving toward athletic and kids' footwear styles and its Top 50 brands and away from dress and seasonal offerings for now. "We are focused on optimizing our assortment to mirror the demands of the customer both now and in the future. The historical success of our dress and seasonal businesses, coupled with our new found market share in athleisure sets the foundation for us to be a stronger player in footwear," CEO Roger Rawlins told analysts last month. "This will enable us to reach an even broader customer base as a one-stop shop." In Q4, DSW generated a 9.2-percent, year-over-year increase in Point-Of-Sale dollars for the sports leisure footwear segment and a 16.1 percent POS dollar improvement in performance athletic. Overall athletic comps were up 19 percent in the fourth quarter, helping the banner generate 46 percent of the period's sales from the category. Now, athleisure makes up 50 percent of DSW's Spring '21 assortment at the expense of some other categories, including dress, whose sales slid 61 percent in the final period. "We have a lot of customers who have made the decision to not buy dress but have transitioned into the athletic, athleisure space," Rawlins said. The athleisure segment is part of DSW's "Top 50" brands that will account for 75 percent of the retailer's inventory purchases this year, up from 60 percent in 2020. On the storefront, the 519-door retailer, which closed five locations in Q4, has eyed 65 U.S. stores for closure over the next four years as leases expire. The list includes 24 doors that are eligible for foreclosure in 2021. Eight new DSW stores, contractually committed to before the pandemic, will open in the U.S. this year. Shoe Carnival Gets Customer-Centric Shoe Carnival is leaning more into specific customer data from its two-year old Customer Relationship Management (CRM) platform and relying less on general, chainwide promotions. Senior management at the 383-door retail chain believes the new strategy will result in further profit and sales growth. A key component of the strategy focuses on increasing merchandise margins by reducing the banner's promotional intensity. "The big insight that we're shifting away from is giving everyone the same offer because we don't know what's important to the specific customer," incoming Shoe Carnival President and CEO Mark Worden told analysts. "We're now getting into a mode… where we can really think about the specific product, the sub-category and giving [customers] an offer and message that's attractive to them." Shoe Carnival generated a 6.4 percent increase in Q4 comparable sales as the number of members in its loyalty "Shoe Perks" program surpassed 26 million. For all of 2020, the retailer suffered a 5.3 percent decline in comparable sales as total revenues hit $976.8 million. Ecommerce grew more than $110 million last year to account for approximately 19 percent, or $185.6 million, of all revenues. During Q4, as merchandise Athletic Still on the Rise at Major Chains RETAIL ANALYSIS

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